A Gambling Commission investigation conducted between November 2014 and August 2016 found senior management failed to mitigate risks and have sufficient numbers of staff to ensure their anti-money laundering and social responsibility processes were effective.

This resulted in ten customers being allowed to deposit large sums of money linked to criminal offences which resulted in gains for WHG of around £1.2m. WHG did not adequately seek information about the source of their funds or establish whether they were problem gamblers.

The Commission has ordered WHG to pay more than £5m for breaching regulations and divest themselves of the £1.2m they earned from transactions with the ten customers. Where victims of the ten customers are identified, they will be reimbursed. If further incidents of failures relating to this case emerge, WHG will divest any money made from these transactions. 

Among the failures identified by the Commission was a customer who was allowed to deposit £541,000 over 14 months after the operator made the assumption that the customer’s potential income could be £365,000 per annum based on a verbal conversation and without further probing. The reality was that the customer was earning around £30,000 a year and was funding his gambling habit by stealing from his employer.

In another example a customer was allowed to deposit £653,000 in an 18 month period, which activated a financial alert at WHG. The alert resulted in a grading of ‘amber risk’ which required, in accordance with the licensee’s anti-money laundering policy, a customer profile to be reviewed. The file was marked as passed to managers for review but this did not occur due to a systems failure. The customer was able to continue gambling for a further six months despite continuing to activate financial alerts.

One customer was allowed to deposit £654,000 over nine months without source of funds checks being carried out. The customer lived in rented accommodation and was employed within the accounts department of a business earning around £30,000 per annum.

The regulator has also required WHG to appoint external auditors to review the effectiveness and implementation of its anti-money laundering and social responsibility policies and procedures and share learning with the wider industry.

Neil McArthur, executive director at the Gambling Commission, said: ‘This was a systemic failing at William Hill which went on for nearly two years and today’s penalty package – which could exceed £6.2m - reflects the seriousness of the breaches.

‘Gambling businesses have a responsibility to ensure that they keep crime out of gambling and tackle problem gambling - and as part of that they must be constantly curious about where the money they are taking is coming from.’

William Hill CEO, Philip Bowcock, said: ‘William Hill has fully co-operated with the Commission throughout this process, introducing new and improved policies and increased levels of resourcing. 

‘We have also committed to an independent process review and will work to implement any recommendations that emerge from that review. 

‘We are fully committed to operating a sustainable business that properly identifies risk and better protects customers. We will continue to assist the Commission and work with other operators to improve practices in the areas identified.’

Gambling Commission’s William Hill regulatory statement is here: http://www.gamblingcommission.gov.uk/PDF/public-statements/William-Hill-...

Report by Pat Sweet